Eighty Conservative candidates have broken their party's official line on the single currency, Labour said today.

A day after Margaret Thatcher told party members that Britain should never join the euro, the chancellor, Gordon Brown, claimed the Tories were "split down the middle" on Europe.

He said that 80 candidates had broken a Conservative manifesto pledge to not join the single currency for the life of the next parliament, promising instead not to join it all.

And out of that number, 23 are calling for renegotiation of the terms of Britain's membership or complete withdrawal from the EU, he said.

"The truth is that the Tories are becoming a party increasingly defined by division on Europe as a growing number become more explicit about their real agenda."

The Europe debate started earlier today with Conservative claims that EU tax harmonisation would scrap Britain's zero rate VAT on items such as food and children's clothing.

But the social security secretary, Alistair Darling, said the Tories had scored an "own goal"

"Having raised the issue of VAT on children's clothes, Michael Portillo would not, when specifically asked to do so, rule it out," he said.

"We know the Tories are addicted to VAT. Every Tory government has extended VAT."

Mr Brown rejected the claim as "a complete lie and a Tory tax smear"

The prime minister, Tony Blair, stayed out of the row. He launched Labour's education manifesto with the education secretary, David Blunkett, promising thousands more teachers and the reform of secondary education.

He said voters should forget about personalities and incidents - "whether it be John Prescott's punch or Margaret Thatcher's intervention" - as they were unimportant.

"I have heard some flimsy stuff in my time but I don't think I've ever heard anything quite so thin as that," he said.

"We're asking people to vote for us to put us into government for the next parliament and, so far as the position after that is concerned, there will be another manifesto at the next election and people can make a judgment on that."

The Tory leader, William Hague, laughed off Lady Thatcher's intervention.

In a visit to Newark, Nottinghamshire, he said that his predecessor's views were well known and denied that they caused him embarrassment. "She says what she said about the single currency every other day, so I don't think that is a surprise to anybody."

He declined to make explicit pledges not to raise taxes such as VAT, sticking only to a general statement that the Tories planned to reduce tax.

"Our plans are to reduce taxes, so we are obviously not planning to increase taxes."

He instead renewed his warnings that the EU was planning to enforce tax harmonisation on Britain, despite denials from Brussels officials that any such intention existed.

The Liberal Democrat foreign affairs spokesman, Menzies Campbell, said the row was "yet another Conservative scare story about Europe.

"So unreasonable are the Conservatives now towards Europe that they see bogeymen around every European corner," he added.